Full Judgment Text
* IN THE HIGH COURT OF DELHI AT NEW DELHI
+ RFA No.103/2018
nd
% Reserved on: 2 February, 2018
th
Pronounced on : 5 February, 2018
RAHUL NARANG ..... Appellant
Through: Ms. Shikha Sapra, Advocate
with Mr. Jatin Choudhary,
Advocate.
versus
HARINDER SINGH ..... Respondent
CORAM:
HON’BLE MR. JUSTICE VALMIKI J.MEHTA
To be referred to the Reporter or not?
VALMIKI J. MEHTA, J (ORAL)
C.M. No.3985/2018 (exemption)
1. Exemption allowed subject to just exceptions.
C.M. stands disposed of.
C.M. No.3986/2018 (for condonation of delay)
2. For the reasons stated in the application, delay of 9 days
in re-filing the appeal is condoned.
C.M. stands disposed of.
RFA No.103/2018 and C.M. No.3984/2018 (stay)
3. This Regular First Appeal under Section 96 of the Code
of Civil Procedure, 1908 (CPC) is filed by the defendant in the suit
RFA No.103/2018 Page 1 of 10
impugning the judgment of the Trial Court dated 27.9.2017 by which
the trial court has decreed the suit filed by the respondent/plaintiff for
a sum of Rs.5,92,000/- along with interest at 12% per annum.
4. The facts of the case are that the respondent/plaintiff
provided his services to the appellant/defendant to arrange a suitable
site for the appellant/defendant to run a gymnasium on profit/revenue
sharing basis. For this purpose, parties entered into an agreement
dated 1.11.2007 and the appellant/defendant was to pay to the
respondent/plaintiff as per the terms laid down in this agreement dated
1.11.2007. The respondent/plaintiff arranged the suitable site to run
the gymnasium and helped the appellant/defendant to enter into a
binding contract for a term of 15 years, and therefore, the following
cheques were given by the appellant/defendant to the
respondent/plaintiff:-
S. No. Cheque no. Dated Amount
(i) 833882 15.12.2007 5,15,000/-
th
(ii) 833823 01.01.2012(5 years) 5,92,000/-
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(iii) 833824 01.01.2016 (9 years) 6,81,000/-
5. As regards the first cheque of Rs.5,15,000/- the
respondent/plaintiff did not get it encashed as per the request of the
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appellant/defendant and agreed to accept, and also received the
amount in cash in installments upto April, 2008. The second cheque
of Rs.5,92,000/- on being due for encashment was lodged by the
respondent/plaintiff with his bank on 2.1.2012 but the same was
dishonoured with endorsement that the payment was stopped by the
drawer. Subject suit was therefore filed for recovery of the amount of
this cheque of Rs.5,92,000/- along with interest.
6. The appellant/defendant contested the suit and filed his
written statement. The appellant/defendant contended that the cheques
in question were got issued by the respondent/plaintiff by giving false
assurances. It was pleaded by the appellant/defendant that the
respondent/plaintiff pursuant to false representations got the
appellant/defendant to sign an Operation and Maintenance Contract
dated 28.11.2007 with one M/s Swim Point with respect to premises at
Kendriya Vidhyalaya Complex but it was found that M/s Swim Point
was not legally competent to execute such contract with respect to the
said premises, and therefore, the appellant/defendant got the payments
of the cheques stopped. It was pleaded by the appellant/defendant in
the written statement that the agreement dated 1.11.2007 failed to
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materialize as no lease deed was executed for 15 years in favour of the
appellant/defendant by M/s Swim Point. Suit was therefore prayed to
be dismissed.
7. The following issues were framed in this suit:-
“1. Whether the plaintiff is entitled for recovery of suit amount as
prayed? If so, at what rate of interest and from which date? OPP.
2. Relief.”
8. Parties led evidence and this is recorded in paras 9 and 10
of the impugned judgment and which paras read as under:-
“9. In evidence, plaintiff examined himself as PW1 vide affidavit Ex
PW1/A. PW1 relied upon documents viz., (i) Agreement dated
01.11.2007 as Ex. PW1/1; (ii) receipt of payment dated 15.12.2007as Ex.
PW1/2; (iii) original cheque no. 833823 dated 01.01.2012 as Ex.
PW1/3; (iv) cheque return memo dated 03.01.2012 as Ex.
PW1/4; (v) copy of legal notice dated 21.01.2012 as Ex. PW1/5;
(vi) original postal receipt as Ex. PW1/6; (vii) courier consignment
note as Ex. PW1/7; (viii) P.O.D. of courier as Ex. PW1/8; (ix) A.D.
form as Ex. PW1/9; (x) reply of defendant through counsel dated
10.02.2012 as Ex. PW1/10; (xi) copy of criminal complaint as Ex.
PW1/11. PW1 was cross-examined.
10. Defendant also got examined himself as DW-1 vide affidavit Ex.
DW1/A. DW1 was crossexamined.”
9. Trial court has held issue no.1 in favour of the
respondent/plaintiff for decreeing the suit. Agreement between the
parties dated 1.11.2007 proved as Ex.PW1/1 has been relied upon by
the trial court with respect to liability of the appellant/defendant. Trial
court has also relied upon the receipt of payment Ex.PW1/2 executed
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between the parties whereby three cheques were handed over to the
respondent/plaintiff by the appellant/defendant. These two documents
being the agreement Ex.PW1/1 and the receipt Ex.PW1/2 read as
under:-
“ AGREEMENT
st
This Agreement is made and entered into this 01 day of November, 2007,
by and between Mr. Rahul Narang, S/o Mr. Rajinder Kumar Narang R/o
A-37, Lajpat Nagar-II, New Delhi (hereinafter referred to as “ First
Party” ) which expression shall mean and include its successors, legal
heirs, representatives, executors and permitted assigns,
AND
Mr. Harinder Singh, S/o Late S. Inder Singh R/o E-71, Greater Kailash
Enclave-I, New Delhi-1100148 (here-in-after referred to as the “ Second
Party” ) which expression shall mean and include its successors, legal
heirs, representatives, executors, assigns and authorized representatives.
The first party is in business of running and operation of gymnasium under
the name & style of OLYMPIA GYM. And is desirous and looking for a
place for expansion for his business in South Delhi on profit/revenue
sharing basis.
The second party has a client who has a place where a gymnasium can be
run and is in a position to bring both the parties on negotiating table and
get a deal done so that both the parties are in a win-win situation.
The first party has agreed to pay to the second party a sum equivalent to
one month revenue which he will be paying for running the gymnasium if
the deals is matured. Further the first party has also agreed to pay to the
second party a sum equivalent one month revenue which he will be paying
for the running of the gymnasium at the beginning of forth year and at the
beginning of seventh year to the other party if the deal is matured and the
total agreement is done and signed for a period of 15 years with the other
party for opening and running of the gymnasium in south Delhi.
The second party will try its level best to get the deal done and signed
between the first party and his client on mutually agreed terms as early as
th
possible and latest by 10 of Dec. 2007.
st
Signed on this day of 01 November 2007, at New Delhi in the presence
of following witnesses.
1. sd/- First Party
2. sd/- Second Party
RECEIPT OF PAYMENT
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st
In reference to the agreement dated 01 November 2007 between me and
Harinder Singh for arranging a place for me for operation of Gymnasium
in South Delhi.
1, Rahul Narang s/o Mr. Rajinder Kumar Narang R/o A-37, Lajpat
Nagar-II, New Delhi states that the deal has been signed between me and
M/s Swim Point for operation and maintenance of Gymnasium at Pacific
Sport Complex, at Kendriya Vidyalaya, Andrews Ganj, New Delhi for a
period of 15 years on mutually agreed terms with the help and
coordination of Mr. Harinder Singh and as per the above mentioned
agreement. I am issuing the following cheques in favour of Mr. Harinder
Singh as agreed by me in the above mentioned agreement.
Chq. No.833822 dated 15.12.2007 for Rs.5,15,000/- (Rupees Five Lacs
and Fifteen thousand only) drawn on The Federal Bank Ltd. S-571,
Greater Kailash-II, New Delhi.
Chq. No.833823 dated 01.01.2012 for Rs.5,92,000/- (Rupees Five Lacs
and Ninety Two thousand only) drawn on The Federal Bank Ltd. S-571,
Greater Kailash-II, New Delhi.
Chq. No.833824 dated 01.01.2016 for Rs.6,81,000/- (Rupees Six Lacs and
Eighty One thousand only) drawn on The Federal Bank Ltd. S-571,
Greater Kailash-II, New Delhi.
-sd- -sd- and 15/12/2007
(RAHUL NARANG) Accepted in full and final
15/12/07 HARINDER SINGH”
10. Trial court also notes that in the cross-examination of the
appellant/defendant who deposed as DW-1, it was conceded by the
appellant/defendant of having signed the agreement with one Mr.
Prem Pal Kathuria, who was proprietor of M/s Swim Point for an
Operation and Maintenance contract pertaining to the gymnasium.
This agreement between the appellant/defendant and M/s Swim Point
was for a total of five years plus five years plus five years. DW-1 also
admitted that as against the first cheque of Rs.5,15,000/-, the
respondent/plaintiff was paid in cash instead of the cheque being
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encashed. It was also admitted by the DW-1 that he stopped the
payment of said cheque of Rs.5,92,000/-. Trial court has also further
held that though the appellant/defendant had contended that no proper
agreement could be entered into of the appellant/defendant with M/s
Swim Point, however the appellant/defendant had failed to file any
orders of OMP No. 518/2007 filed in this Court pertaining to the
property taken by the appellant/defendant from M/s Swim Point and
which could have shown that the appellant/defendant could not take
benefit of the Operation and Maintenance contract entered into by it
with M/s Swim Point so that respondent/plaintiff was not to be paid.
Trial court has further noted that the only liability of the
respondent/plaintiff was to facilitate the maturing of the deal which
was done. Trial court accordingly held the respondent/plaintiff entitled
to the sum of Rs.5,92,000/-.
11. Some of the relevant paras containing the aforesaid
conclusions are paras 15, 16, 18 and 19 and which paras read as
under:-
“15. In the course of cross-examination on 06.02.2017, defendant as
DW1 admitted of having signed one agreement with Mr. Prem Pal
Kathuria, Proprietor of M/s. Swim Point, which agreement was for the
purpose of leasing the place (Operation and Maintenance
RFA No.103/2018 Page 7 of 10
Contract). DW1 elicited that for him it was lease but Mr. Kathuria
could only enter into an operation and maintenance contract. The
period of said agreement was for 5 years plus 5 years plus 5 years i.e. total
of 15 years. In said cross-examination DW1 candidly admitted of
having issued Receipt of Payment Ex. PW1/2 dated 15.12.2007 as well
as the cheques mentioned therein. Also was stated by DW1 that he was not
sure if the amount of cheque issued by him to M/s. Swim Point was
around 15 lakhs. It makes clear of existence of fact of payment of a
cheque by defendant to M/s. Swim Point on entering into contract with it.
DW1 also admitted of having given cash to plaintiff against first cheque
of Rs. 5,15,000/-. DW1 further elicited that he had stopped payment of
cheque Ex. PW1/3 of Rs. 5,92,000/- of date 01.01.2012.
16. It is the defence of defendant that later to signing of
the agreement he came to know that M/s. Swim Point was neither
authorised nor legally competent to execute any contract
/agreement with respect to the said place; as such the defendant could not
in any manner open a gymnasium in said property. It is also the case of
the defendant that he came to know about a case pending before the High
Court of Delhi bearing OMP No. 518/2007 pertaining to said property
wherein it was directed to maintain the status quo in relation to the user of
said property. Also is the defence of defendant that on becoming aware of
said facts regarding dispute in the property, defendant asked for
refund of his amount already paid as deal remained incomplete and could
not be matured as per brokerage agreement Ex. PW1/1 dated
01.11.2007. The defendant has neither filed nor proved any certified
copies of Order of High Court of Delhi in the afore elicited OMP
518/2007. No cogent evidence has been led by defendant that M/s. Swim
Point was neither authorised nor legally competent to execute any
agreement with respect to the said place and / or defendant could not in
any manner open a gymnasium in the said property.
xxxxx xxxxx xxxxx
18. As per Ex. PW1/1, the plaintiff was only to facilitate
maturning of deal (agreement) between defendant and other party
for running of gymnasium. Defendant in Ex. PW1/2
categorically admitted of maturing of said deal (agreement)
signed between him and M/s. Swim Point for operation and
maintenance of gymnasium at Pacific Sports Complex, at
Kendriya Vidyala, Andrews Ganj, New Delhi. Cash in
installments in lieu of cheque of Rs. 5,15,000/- bearing no.
833822 dated 15.12.2007 was paid by defendant to plaintiff.
19. For completing his part of the agreement Ex. PW1/1,
the plaintiff PW1 had been instrumental in maturing the promised deal
(agreement) interse defendant and M/s. Swim Point for operation
and maintenance of gymnasium at Pacific Sports Complex, at
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Kendriya Vidyala, Andrews Ganj, New Delhi for a period of 15 years on
mutually agreed terms. The party entering into such deal before
concluding the agreement needs to be beware and take all
precautions whatsoever and is always at liberty to put in any kind of
default clause for defaulting party. Be that as it may, fact remains
it is proved on record that defendant had entered into an agreement
with M/s. Swim Point for operation and maintenance of gymnasium at
Pacific Sports Complex, at Kendriya Vidyala, Andrews Ganj, New Delhi
for a period of 15 years on mutually agreed terms, as is borne out of Ex.
PW1/2 and admitted by DW1. Accordingly, plaintiff becomes
entitled for the sums promised by defendant for which he had given the
post dated cheques on 15.12.2007 to plaintiff as elicited in detail
hereinabove in the averments of Ex. PW1/2. The defendant/DW1 had
stopped the payment of cheque Ex. PW1/3 of Rs. 5,92,000/- in
question. Plaintiff is held entitled for sum of Rs. 5,92,000/- from
defendant. Plaintiff was working for gain and transaction was commercial
in nature. In the fact of the matter, having regard to nature of
the commercial transaction between the parties, finding it
expedient, in the interest of justice, plaintiff is accordingly held
entitled for interest @ 12% per annum on sum of Rs. 5,92,000/- from the
date of filing of the suit till realisation from defendant. Issue no.1 is
accordingly decided in favour of the plaintiff and against the defendant.”
(underlining added)
12. I do not find any illegality or perversity whatsoever in the
impugned judgment and this Court is therefore not inclined to interfere
with the impugned judgment as this Court accepts the reasoning and
conclusion given by the trial court for decreeing the suit, and as stated
above.
13. Counsel for the appellant/defendant sought to argue that
the Negotiable Instruments Act case filed under Section 138 by the
respondent/plaintiff against the appellant/defendant was dismissed,
RFA No.103/2018 Page 9 of 10
and therefore, it was argued that the said suit also had to be dismissed,
however besides the fact that there are no such documents on record
even if the documents were on record in law the judgment in a
criminal case does not operate as res judicata or binds the civil court
to decide the cause of action and issue of entitlement of the
respondent/plaintiff to commission.
14. Learned counsel for the appellant/defendant then sought
to argue that the appellant/defendant could not enter into a proper
lease deed as M/s Swim Point did not have the necessary documents
and to which argument in para 16 of the impugned judgment it is
noted that no such documents were filed by the appellant/defendant,
and therefore, no argument can be urged on such basis. This argument
of the appellant/defendant is also therefore rejected.
15. In view of the aforesaid discussion, there is no merit in
the appeal. Dismissed.
FEBRUARY 05, 2018 VALMIKI J. MEHTA, J
Ne
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